Gulf States Manufacturing has the following data from year 1 operations, which are to be used for developing year 2 budget estimates:

Sales revenues (14,000 units)	$	1,260,000
Manufacturing costs
Materials	$	225,000
Variable cash costs		307,000
Fixed cash costs		123,000
Depreciation (fixed)		151,000
Marketing and administrative costs
Marketing (variable, cash)		160,000
Marketing depreciation		39,000
Administrative (fixed, cash)		156,000
Administrative depreciation	$	14,000
Total costs	$	1,175,000
Operating profits	$	85,000

All depreciation charges are fixed. Old manufacturing equipment with an annual depreciation charge of $15,750 will be replaced in year 2 with new equipment that will incur an annual depreciation charge of $22,200. Sales volume and prices are expected to increase by 14 percent and 3 percent, respectively. On a per-unit basis, expectations are that materials costs will increase by 12 percent and variable manufacturing costs will decrease by 2 percent. Fixed cash manufacturing costs are expected to decrease by 9 percent.

Variable marketing costs will change with volume. Administrative cash costs are expected to increase by 10 percent. Inventories are kept at zero. Gulf States operates on a cash basis.

Required:

Prepare a budgeted income statement for year 2. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts.)

GULF STATES MANUFACTURING Budgeted Income Statement For Year 2 Manufacturing costs: Total manufacturing costs Marketing and administrative costs: Total marketing and administrative costs Total costs